Question

Two friends took a loan of ₹25 000 on the same day and from the same bank at the rate of 10% simple interest.After 2 years the money by which the first man repays the loan with interest after 3 years the second man repays the loan by giving the same amount.How much money each have to pay at the time of loan repayment?

Answer 1

Step-by-step explanation:

Compound Interest is nothing but Simple interest per year with the amount at the end of every year being the principal for the next year.

For the first year ,

Simple Interest SI=

100

PNR

So, SI=

100

25000×1×20

=Rs5000

So, Amount A=25000+5000=Rs30000

For the second year ,

P =30000−8000=Rs22000

So, SI=

100

22000×1×20

=Rs4400

So, Amount A=22000+4400=Rs26400

For the third year ,

P =26400−8000=Rs18400

So, SI=

100

18400×1×20

=Rs3680

So, Amount A=18400+3680=Rs22080

So, Rs22080 has to paid off to clear the loan.